Ian Copsey is a veteran analyst having begun his career in Forex 28 years ago. He is author of "Integrated Technical Analysis" and his new groundbreaking book "Harmonic Elliott Wave." He provides his popular daily forecast “The Harmonic Daily Forecaster” through his website www.harmonic-ewave.com.

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HARMONIC ELLIOTT WAVE

Wednesday, December 22, 2010

If the Dollar is going to rally this side of Xmas then today’s the day … else wait till next week

Please note The Daily Forecaster will take a break from the 24th December and return on the 3rd January

Yesterday was a strange day, but that’s saying very little given the time of year. Maybe too many traders were more interested in first lunar eclipse on the winter solstice in 456 years… I could accept that if 456 had been a Fibonacci number... but it’s not… More likely they were more interested in a quiet period ahead of a few days of merriment.

The Dollar neither made minor early gains nor retraced as far as I had expected, but ended the day with GBPUSD, EURUSD and EURJPY sitting close to the more aggressive break lower I had been anticipating. Will the market have the energy to commit to the stronger follow-through today? Maybe… maybe not. Most probably they’d prefer not to have the hassle of being caught in the game of pass-the-parcel where the person left holding the parcel incurs a loss.

However, the risk is there and with just today and tomorrow left offering a semblance of almost normal trading conditions if the right levels are broken then those three currency pairs will be sent tumbling. If those levels hold – and there are signs that they will – then all we’re going to see is a total recycling of the correction that could take us into the long weekend. However, once the weekend is over the Dollar should extend its gains then.

Just a word on USDJPY… It’s struggling but just about clinging onto a push back higher after failing at the 83.50 support I pointed out yesterday. It needs to make further gains today to keep on that bullish track but I doubt we’ll see any fireworks … or red moon… today. Certainly USDCAD looks like it will extend its consolidation today but that does seem to be due a subsequent push higher. AUDUSD looks as if it will subside into a sideways consolidation also.

Thus the stronger risk is for continued subdued trading – but just watch out for the key Dollar resistance levels.

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DISCLAIMER: Daily Forecaster is an analytical tool only and is not intended to replace individual research. The service is offered as an opinion on the current state of the market with anticipated trading signals but not recommendations. The information provided in Daily Forecaster should not be relied on as a substitute for extensive independent research before making your trading/investment decisions. Ian Copsey is merely providing this service for your general information. No representation is being made that any view or opinion will guarantee profits or not result in losses from trading. In addition any projections or views of the market provided may not prove to be accurate. The opinions are subject to change without notice. Opinions or views expressed in Daily Forecaster are not meant to be either investment advice or a solicitation or recommendation to establish market positions. Ian Copsey will not be responsible for any losses incurred on investments made by readers and clients as a result of any information contained in this service. It must be understood that Forex trading involves substantial risk of losses as well as profits. The information contained is private and may not be distributed or shared.

About Ian

I have been around in financial market for over 30 years, the last 23 years as a technical analyst. I focus heavily on price development and structure as it is the only way to generate accurate support and resistance. I use my own adapted form of Elliott Wave along with derivatives of Fibonacci and harmonic ratios to derive support and resistance. I provide a range of reports covering daily & weekly Forex, U.S. Indices.